As mentioned previously on this blog, California is in the small group of US states that use the community property method of property division when it comes to dividing items during a divorce. If you are involved in or around a California divorce case, you know that the terms “community property” and “separate property” are used frequently. As also mentioned previously, the former is divided equally during a California divorce while the latter is not. If you’re interested, community property in California is defined in section 760 of the California Family Code while separate property is defined in section 770(a) of the California Family Code.
New York, on the other hand, is not a community property state, but rather uses a property division method called Equitable Distribution. New York is similar to most states in the US in that only about 10 states (mostly in the western US and southwestern US) use the community property method.
Unfortunately, this distinction can become confusing to talk about because New York also uses the term “separate property” like California does. However, in place of “community property,” New York uses the term “marital property.” Terminology aside, what also makes it confusing is that the definitions for separate and marital/community property look very similar.
For example, in New York, “separate property” is defined in New York Domestic Relations Law section 236(B)(1)(d) as:
- property acquired before marriage or property acquired by bequest, devise, descent, or gift from someone other than the person’s spouse;
- compensation for personal injuries;
- property acquired in exchange for or the increase in value of separate property, except to the extent this is due to the other spouse; or
- property described as separate as part of a written agreement, such as a prenuptial agreement.
To compare, California Family Code section 770(a) defines separate property as:
- All property owned by the person before marriage;
- All property acquired by the person after marriage by gift, bequest, devise, or descent; or
- The rents, issues, and profits of the property described in this section.
In New York, “marital property” is defined in section 236(B)(1)(c) of the Domestic Relations Law as:
“all property acquired by either or both spouses during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action, regardless of the form in which title is held, except as otherwise provided in agreement pursuant to subdivision three of this part. Marital property shall not include separate property as hereinafter defined.”
In other words, marital property in New York is that which is acquired during the marriage through either (a) the execution of a separation agreement, or (b) commencement of divorce proceedings. This latter portion is actually different than how community property works in California.
In California, community property is defined in section 760 of the California Family Code as:
“Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property.”
This initially reads very much like the New York definition of marital property — in other words, it’s just stuff you acquire during your marriage. The big difference, though, is when the community property or marital property rights end. In New York, marital property rights end — as mentioned before — when either a separation agreement is signed or divorce proceedings are commenced. This standard is, for lack of a better term, black and white so you can definitively determine when marital property rights have ended.
In California, under section 771(a) of the Family Code, community property rights end when the parties separate. Items that either spouse then acquire are their own separate property once again and need not be split during a divorce. As you can probably imagine, however, establishing a date of separation can be a big deal if a case involves a large acquisition. If Spouse A wins the California lottery, for example, she might be motivated to claim that that happened after she separated from Spouse B so that the winnings will not be community property that she has to split with Spouse B. Similarly, Spouse B will be motivated in the other direction to claim that Spouse A won the lottery before they separated. That way, the lottery winnings are community property and Spouse B will be entitled to a portion.
Given how important the date of separation is, you would think that California defines it with black and white criteria so that the date can be definitively determined. You would think that, but you would be incorrect. In California, the date of separation is defined in section 70 of the California Family Code which provides that the date of separation is:
“the date that a complete and final break in the marital relationship has occurred”
Section 70 then lays out two criteria that both must be satisfied to show that a complete and final break has occurred:
- The spouse has expressed to the other spouse his or her intent to end the marriage, and
- The conduct of the spouse is consistent with his or her intent to end the marriage.
Hopefully all of this helps you understand while each US state does property division in a divorce differently, there are still many similarities nonetheless. As always, this post is not meant to be a comprehensive or exhaustive treatment of this topic. If you have a situation involving property division in a divorce, please do find a lawyer in your area with whom you can discuss the intricacies of your case.
As always — again — my usual disclaimer applies regarding New York Judicial Law section 470: I am licensed to practice law in New York state, but do not maintain an office in New York state as of the date of this post. As a result, I am unable to take clients in New York state, but would be happy to make a referral for you if I can do that.
Latest posts by Andy Chen (see all)
- Cost-Benefit Analysis in Forming a Limited Liability Company - July 12, 2023
- Minimizing Tax and Legal Liability When Starting a Business - July 9, 2023
- Law School Help: California Criminal – Robbery - July 4, 2023